1
Corporate Governance
Last Update: June 15, 2020
Isetan Mitsukoshi Holdings Ltd.
Toshihiko Sugie, Director, President and CEO
(Representative Executive Officer)
Contact: General Affairs Department,
Group General Affairs Department
Securities Code: 3099
https://imhds.disclosure.site/en/themes/132#1071
The current corporate governance measures at Isetan Mitsukoshi Holdings Ltd. (the “Company”) are as
follows.
I Basic Views on Corporate Governance, and Basic Information on Capital Structure, Corporate Attributes, and Other Matters
1. Basic Views Updated
Please refer to the Corporate Governance Guidelines section of the Company website regarding basic views and policy
for corporate governance at Isetan Mitsukoshi Holdings.
(URL: https://imhds.disclosure.site/en/themes/132#1071): Section titled Corporate Governance
[Reasons for non-compliance with each of the principles of Japan’s Corporate Governance Code] Updated
The Company complies with all principles of Japan’s Corporate Governance Code.
[Disclosure based on each of the principles of Japan’s Corporate Governance Code] Updated
[Principle 1-4, Supplementary Principles 1-4 (1)(2)]
Cross-shareholdings
(1) Policy on cross-shareholdings
The basic policy of the Group is to not acquire or hold cross-shareholdings in principle, except when cross-
shareholdings are deemed conducive to sustainable growth and enhancement of corporate value of the Group over
the medium- to long- term. With regard to the cross-shareholdings the Company currently holds, every year at the
Board of Directors, the Company comprehensively verifies whether it is rational to continue holding such cross-
shareholdings from quantitative and qualitative aspects including the purpose of holding, transaction status, and
dividend earnings. Regardless, the Company will proceed with phased sales in consideration of factors such as the
market environment and status of shares held with the aim of reducing cross-shareholdings.
(2) Standards for exercising voting rights in relation to cross-shareholdings
Regarding the exercise of voting rights for cross-shareholdings, an overall judgment is made as to whether or not
exercise of such rights would spur sustainable corporate value of said company or contribute to sustainable growth
and enhancement of corporate value of the Group over the mid- to long-term. Such voting rights are duly exercised
for each agenda item.
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(3) Policy in the case that cross-shareholders indicate their intention to sell shares
When shareholders who hold the Company’s shares for the purpose of cross-shareholding (cross-shareholders)
indicate their intention to sell their shares, the Company will not hinder the sale of the shares by, for instance,
implying a possible reduction of business transactions.
[Principle 1-7, 4-3]
Transactions between Related Parties
Regulations on officers including the Regulations of the Board of Directors and Regulations of Executive Officers
stipulate that, in the event that a conflict of interest transaction or competitive transaction is entered into between
officers themselves such as Directors and Executive Officers or their specified family members and the Company,
or between a company or organization where officers themselves or their specified family members hold a position
as officers and the Company, the important facts of such transactions are to be disclosed to the Board of Directors
in advance for its approval. This rule is disseminated throughout the Company. The Board of Directors reaches a
decision on approval after due deliberation of the transaction.
[Principle 2-6]
Functional Roles as Corporate Pension Fund Asset Owners
The Company’s retirement pension plan has transitioned to a defined contribution corporate pension plan.
Although the defined benefit corporate pension plan is still available for some retired employees, its influence on
the Company’s financial position is extremely limited. For pension investment management, qualified persons
suitable for such duties are placed in relevant departments, and we receive periodic reports on investment status
from financial institutions for monitoring.
[Principles 3-1(i), 2-1]
Purpose of the Company (Management Philosophy, etc.), and Management Strategies and Management Plans
To achieve sustainable growth as a company in an age of rapid change, the Group will seek to continue a drastic
reform of the entire Group. In 2018, we compiled a credo “Our philosophy,” which is the raison d’etre of the
Isetan Mitsukoshi Group and the way we want to be.
The Group utilizes its in-house media, such as company newsletters and intranet, to disseminate within the Group
the meaning of “Our philosophy” and expected behaviors, while holding lectures as part of the training session
for new hires with the aim of creating an ever-evolving corporate culture. We strive to thoroughly familiarize the
entire Group with the credo such as by having all of our officers attend the annually held “Our philosophy”
Promotion Meetings to introduce initiatives including best dialogue-based practices contributing to changes in
corporate culture.
In addition, the Company has established the “Isetan Mitsukoshi Group Standards of Corporate Ethical Behavior”
as the foundation for putting “Our philosophy” into practice, and demonstrates to all of its employees including
officers its approach to stakeholders along with the group-wide ethics and guidelines for daily conducts of the
group employees.
Refer to the Company website for details of management philosophy and management plans:
https://www.imhds.co.jp/en/company/philosophy.html: “Our philosophy”
https://imhds.disclosure.site/en/themes/168: Initiatives for disseminating “Our philosophy” across the Company
https://www.imhds.co.jp/en/ir/plan.html: The Isetan Mitsukoshi Group’s Medium-term Management Plan (Three-
year Plan) (FY2019 to FY2021)
[Principle 3-1(ii)]
Basic Views and Policy Regarding Corporate Governance Based on Each of the Principles in Japan’s Corporate
Governance Code
In combination with measures to build excellent relationships with customers, employees, shareholders, business
partners and local communities—our stakeholders—the Group is overhauling its corporate governance structure,
along with management reform. This entails the establishment and strengthening of legal frameworks for the
general meeting of shareholders, the Board of Directors and the accounting auditors.
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As part of these efforts, for the purpose of further advancing corporate governance, the Company decided on the
transition of its organizational design to a company with a nominating committee, etc. effective June 2020.
With the transition to a company with a nominating committee, etc. as a turning point, the Group will work to
further increase the transparency of our corporate activities and ensure thorough compliance in our management,
while taking measures to create and deliver value in various forms for all stakeholders associated with the Group.
Aiming to become a corporate Group that is deeply trusted by all of its various stakeholders, the Group will
continue taking a range of measures including speeding up management decision-making, strengthening
management oversight mechanisms and enhancing internal control systems.
Refer to the Corporate Governance Guidelines on the Company website for more details.
https://imhds.disclosure.site/en/themes/132#1071
[Principles 3-1(iii), 4-2, Supplementary Principle 4-2(1)]
Policies and Procedures with Regard to Board of Directors’ Decisions Concerning Remuneration of Senior
Management Executives and Directors
(1) Policy regarding the remuneration, etc. of officers
The Company has established the following four basic principles regarding executive remuneration (excluding
Outside Directors).
1) Promotion of common interests between shareholders and officers
2) Expansion of incentive effects to improve financial results and shareholder value
3) Provision of remuneration at a level by no means inferior to competing companies (upon achieving goals)
4) Ensuring objectivity and transparency in methods of evaluation and remuneration decision
These basic principles have been formulated as “Director Remuneration Principles” in the “Director Remuneration
Guidelines.”
Based on these basic principles, the Nomination and Remuneration Committee, a voluntary advisory body, has
actively discussed ways for linking to the short-term performance and the medium- to long-term performance in
the entire remuneration and approach to the share-based remuneration system. After the transition to a company
with a nominating committee, etc., the Compensation Committee, comprising a majority of Outside Directors,
will be led by Outside Directors in discussing and deciding on the policy of remuneration and individual amounts
of remuneration, and continue its deliberations and initiatives so that the executive remuneration system functions
better as a healthy incentive towards the sustainable growth of the Company.
(2) Matters concerning the process for determining executive remuneration
Under the above Director Remuneration Principles, the objectivity and transparency of the entire process of
determining executive remuneration are ensured through the effective deliberation at the Compensation
Committee, a statutory committee that is comprised of a majority of Outside Directors and chaired by one of them.
(3) Types of remuneration, etc. of officers and the method by which they are determined
Under the Director remuneration system of the Company, executive remuneration is composed of three elements:
monthly “basic remuneration” along with “bonuses” and “share-based remuneration” which are paid or granted
annually. For Executive Officers, including the President and CEO (Representative Executive Officer), bonuses
that are paid as a form of performance-linked remuneration shall account for 25% of the total annual remuneration
for each individual, with the aim of clarifying their responsibilities for business execution.
Meanwhile, share-based remuneration shall account for 15% of the total annual remuneration for each individual,
with a view toward promoting shareholdings by officers and their common interests with the shareholders.
(Bonuses shall not be paid to internal Directors except for those who concurrently serve as Executive Officer, and
Outside Directors.)
Specific amounts of remuneration are determined at the Compensation Committee, which is comprised of a
majority of Outside Directors and chaired by one of them.
The Company is currently conducting fundamental considerations on ways for linking to the short-term
performance and the medium- to long-term performance in the entire remuneration and approach to the share-
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based remuneration system that has replaced the remuneration-type stock options scheme, so that the officer
remuneration system functions better as a healthy incentive towards the sustainable growth of the Company. In
FY2020 and onwards after the transition to a company with a nominating committee, etc., the Compensation
Committee will continue such considerations and work to bring discussion results into shape.
<Bonuses>
For Executive Officers including President and CEO (Representative Executive Officer), performance-linked
bonus as described hereunder has been introduced as a strong motivation towards the achievement of goals based
on the Director Remuneration Principles.
Base amount of bonus = Basic remuneration x 5 (months)
Amount of bonus to be paid = Base amount of bonus x [1] Payout ratio (degree of achievement against the
corporate performance goal) x [3] Allocation ratio (weight) + Base amount of bonus x [2] Payout ratio
(personal qualitative evaluation) x [3] Allocation ratio (weight)
1) Payout ratio (degree of achievement against the corporate performance goal)
Since the Company’s foundation in FY2008, the Group has adopted consolidated operating income as its indicator
to strongly motivate officers to achieve annual goals, with a view toward quickly establishing a sound operational
base for the Group and launching its management on a growth track into the future.
Specifically, the payout ratio shall be 1.00 (100%) upon the full achievement of the operating income goal, and
designed to vary within the range between 0.00 (0%) at minimum and 2.00 (200%) at maximum, in proportion to
the degree of achievement. The amounts of consolidated operating income corresponding to such minimum and
maximum factors shall be determined for each fiscal year, based on the absolute standards of the targeted amount,
with a view toward providing clear and effective incentives.
2) Payout ratio (personal qualitative evaluation)
The payout ratio of qualitative evaluation shall be subject to a five-grade evaluation (between 0.50 (50%) at
minimum and 1.50 (150%) at maximum) by President and CEO (Representative Executive Officer) at the end of
each fiscal year, based on the assessment of the degree of achievement of the qualitative goals established through
the interview with the President and CEO (Representative Executive Officer) at the beginning of each fiscal year.
3) Allocation ratio (weight)
The allocation ratio (weight) between the degree of achievement against the corporate performance goal and the
personal qualitative evaluation shall be determined for each fiscal year following a review of its positioning. As
for FY2020, the allocation ratio of the degree of achievement against the corporate performance goal is set at
100% for the President and CEO (Representative Executive Officer). For other Executive Officers, such allocation
ratio is set at 60% and the allocation ratio of the personal qualitative evaluation is set at 40%.
<Remuneration-type stock options>
With regard to share-based remuneration, stock options whose exercise price is set at one yen were granted to
Directors (excluding Outside Directors) up until FY2019 as follows, based on the remuneration-type stock options
scheme involving an exercise price set at one yen, with a view toward promoting shareholdings by officers and
enhancing awareness towards improving shareholder value over the long-term.
Maximum number of stock options to be granted (each stock option being equivalent to 100 shares of the
Company) = (Basic remuneration) x 6 (months) / Reference price of a share of the Company (*)
*Reference share price = “Average price of share over the three months up to the month prior to the resolution on
issuance” or “the price of a share on the day four days prior to the date of the resolution on issuance (if no closing
price is quoted on such day, the closing price of the immediately preceding business day)” at the Tokyo Stock
Exchange, whichever is higher.
The Company is currently conducting fundamental considerations on the approach to the share-based
remuneration system, so that the officer remuneration system functions better as a healthy incentive towards the
sustainable growth of the Company.
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[Principles 3-1(iv)(v), Supplementary Principles 4-1(3), 4-3(1)(2)(3), Principle 4-11]
Explanation on Policies and Procedures on the Board of Directors’ Selection/Dismissal of Management Executives
and Nomination of Candidates for Director, and Individual Selection/Dismissal
(1) Policies on selection and dismissal of management executive officers
As a policy of selection and dismissal of senior management Executive Officers, including Representative
Executive Officers, the Company stipulates the maximum age and the maximum reappointment term of officers
for each position in the Regulations of Age Limits of Executive Officers in Office to promote appropriate rotation.
Given this, selection of Executive Officers, including Representative Executive Officers and Executive Officers
with special titles, and their reappointment after the expiration of the one-year term of the appointment contract
shall be determined by the Nominating Committee by appropriately evaluating quantitative results of respective
Executive Officers during their term of appointment contract, along with qualitative aspects, such as contributions
in materializing the Group’s “Our philosophy.” As such, the fairness and transparency of the selection and
dismissal of management executives is secured.
<Decision on selection and reappointment of the CEO>
Before the transition to a company with a nominating committee, etc., the Company worked on the following
measures to ensure transparency and fairness in deciding on selection and reappointment of the CEO.
(i) Decision on reappointment of the current CEO
With respect to acceptance or non-acceptance of reappointment of the current CEO (reappointment after expiration
of the term of the appointment contract), the Nomination and Remuneration Committee undertook the following.
*At the time of inauguration of the CEO, the CEO submits in person a commitment (goals to be achieved) for the
estimated term of office, of which acceptance/non-acceptance is discussed.
*In the following and subsequent years, the CEO explains progress for the commitment, future earnings forecasts,
etc., and after the CEO leaves the meeting, four Outside Directors who are members of the Committee deliberate
on the acceptance/non-acceptance of reappointment of the CEO.
(ii) Succession plan of the CEO
The Company actively created opportunities where Outside Directors can monitor candidates after the following
contents were periodically reported and shared at the Nomination and Remuneration Committee.
*Listing of candidates for a CEO successor (for emergencies, at the time of change before expiration of term, and
the maximum term of office)
*Clarification of requirement for the CEO
*Training plans for each candidate and plans for relocation to sectors that each candidate should experience in the
future
Furthermore, with regard to the development of candidates, the Company has created a reserve group of candidates
for the CEO successor by spending adequate time and resources by providing systematic education opportunities
such as the “business leader program” which is a selective education program for managerial positions and the
“business executive program” after assumption of office as executive officer.
As described above, the Company has worked on the decision on reappointment of CEO and the succession plan
while ensuring transparency and fairness. After the transition to a company with a nominating committee, etc., the
Company will position the decision on selection and reappointment of CEO as one of the most important tasks of
the Nominating Committee, and the Committee will actively discuss its approach to the matter in order to further
enhance the initiatives that have been implemented.
(2) Policy on nomination of candidates for Director
With regard to nomination of candidates for Director, the policy of the Company is to look for candidates from a
diverse range of people with broad and highly specialized knowledge and skills, as well as high ethical standards.
For Outside Directors in particular, the Company invites people from different fields and industries, primarily
those with practical business-world experience, in order to actively take in a wide range of opinions from objective
and specialist perspectives and ensure well-balanced management.
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Candidates for Director are determined at the Nominating Committee, which is comprised of a majority of Outside
Directors and chaired by one of them, and the proposal is submitted to the general meeting of shareholders.
Regarding senior management Executive Officers, the Board of Directors shall determine candidates after the
deliberation by the Nominating Committee.
The reasons for nomination of each candidate for Director are described in the “Notice of the Convocation of the
Ordinary General Meeting of Shareholders” (Reference Documents for the General Meeting of Shareholders).
As described above, Outside Directors lead the deliberation and decision-making regarding the nomination, which
is important in terms of corporate governance, in order to improve the objectivity and transparency. The
Nominating Committee will work to further clarify the officer selection standards of the Company.
https://www.imhds.co.jp/en/ir/stockholder/meeting.html: Section titled General Meeting of Shareholders
[Principles 4, 4-1, Supplementary Principle 4-1(1)]
Responsibilities of the Board of Directors
As part of efforts to promote the Group’s sustainable growth and the enhancement of corporate value over mid-
to long-term, and sufficiently fulfil its fiduciary responsibility to shareholders, the Company worked to further
clarify the separation of “execution” and “oversight” and strengthen decision-making functions and oversight
functions to be fulfilled by the Board of Directors, through the review of criteria for making proposals to be decided
upon by the Board of Directors and the delegation of authority to the execution side where necessary within a
range of a company with the Audit & Supervisory Board. Under this environment, the Company’s Board of the
Directors actively engaged in discussions on important managerial issues from a wide perspective, utilized such
discussions for preparing the mid- to long-term management plan, and, through the monitoring of the progress of
the plan, worked to establish the management PDCA cycle with the Board of Directors as the starting point.
The Board of Directors after the transition to a company with a nominating company, etc. will further accelerate
the move, and limit matters requiring a resolution by the Board of Directors to those set forth in laws and
regulations, in principle, whereby it will primarily discuss management from a wide perspective and specialize in
overseeing and monitoring the execution of business operations.
[Supplementary Principle 4-1(2)]
Administrative Management of the Medium-term Management Plan
For the purpose of developing and strengthening the PDCA cycle for management, the Company holds at the
Board of Directors multiple step-by-step exchanges of opinions as part of the process to formulate a medium- to
long-term management plan while fully reflecting the opinions of outside officers. Progress reports and discussions
at the Board of Directors during the term of the plan serve as the basis for amendments to the plan. In addition, in
order to fulfil adequate accountability, the Company discloses materials regarding management plans and progress
to stakeholders, including shareholders and investors, at the general meeting of shareholders and semi-annual
financial results briefings, as well as on the Company website, etc.
[Principles 4-6, 4-7, 4-8, 4-11, Supplementary Principle 4-11(1)(2)]
Composition of the Board of Directors
The Company’s Articles of Incorporation stipulates that the number of Directors shall not exceed 15, and currently
there are 13 members in the Board of Directors. In light of strengthening corporate governance, Outside Directors
are in the majority in the Board of Directors (seven Outside Directors and six internal Directors).
Furthermore, the policy of the Company for the Board of Directors is to appoint a diverse range of people with
broad and highly specialized knowledge and skills, as well as high ethical standards. For Outside Directors in
particular, the Company invites people from different fields and industries, primarily those with practical business-
world experience, in order to actively take in a wide range of opinions from objective and specialist perspectives
and ensure well-balanced management. All Outside Directors satisfy the Independence Standards of the Company.
Furthermore, the Regulations of the Board of Directors set out that the Board of Directors shall be chaired by a
non-executive Director. The Company has made it clear from FY2020 that the current Chairman, who will
continue presiding over the Board of Directors, is non-executive.
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[Principle 4-9]
Independence Standards and Qualifications for Independent Outside Officers
In designating Outside Directors and as independent officers, the Company has compiled its proprietary
“Independence Standards for Independent Directors and Independent Auditors of Isetan Mitsukoshi Holdings Ltd.,”
for assessing their independence and outside officers who do not come under any of the following categories are
nominated as independent officers.
1) Business executives of the Group
2) A person for whom the Group is a major business partner, or an executive director, executive or manager thereof
3) A major business partner of the Group, or an executive director, executive, manager or other employee thereof
4) An executive officer of a principal lender of the Group
5) A consultant or accounting or legal expert who has received financial or other economic benefits from the
Group exceeding a certain sum, other than remuneration of Directors or Audit & Supervisory Board Members
6) A shareholder or an executive officer thereof who holds at least 5% of the total issued shares of the Company
7) Any person who has come under categories 1) to 5) above in the last three years
8) Spouses or relatives within the second degree of kinship of anybody coming under categories 1) to 5) above
A “major business partner” in 2) and 3) above means “any business partner for whom the annual transaction
amount with the Company, on a consolidated basis, exceeds 1% of the total annual transaction amount of either
party, over the preceding three years, even if this occurs on only one occasion,” a “principal lender” in 4) above
means “any lender from whom the Group’s balance of borrowings exceeds 2% of the consolidated total assets of
the Company as of the end of the fiscal year,” and a “certain sum” in 5) above means “a sum of at least 10 million
yen in any of the preceding three fiscal years.”
[Principle 4-10, Supplementary Principle 4-10(1)]
Systems to Enhance Governance Functions of the Company
The Company made a transition to a company with a nominating committee, etc. in June 2020, and set up the
Nominating Committee, the Compensation Committee, and the Audit Committee, three statutory committees that
are comprised of a majority of Outside Directors.
The Nominating Committee and the Compensation Committee strive to enable independent judgments by Outside
Directors concerning discussions and decision-making related to the “nomination” and “remuneration.” To this
end, the committees will take various measures, such as increasing contact with prospective nominees and utilizing
personnel evaluations and other objective indicators. The Audit Committee will endeavor to build and operate a
system that ensures both the effectiveness and independence so as to sufficiently exercise its audit functions.
[Supplementary Principle 4-11(3)]
Effectiveness Evaluation of the Board of Directors
The Company has conducted the annual analysis and evaluation of the Board of Directors since FY2016. In
FY2019, an individual questionnaire to all Directors and Audit & Supervisory Board Members inside and outside
the Company was conducted, to evaluate the Board of Directors both from quantitative and qualitative aspects,
such as the composition of the Board, details of deliberations, operations including support from the secretariat,
and processes for determining the nomination and remuneration of officers.
The evaluation results for FY2019 have shown that the average score of all quantitative questions has exceeded a
“standard level” to a certain degree, confirming that the overall effectiveness of the Company’s Board of Directors
is ensured. On the other hand, room for improvement was revealed, including the setting of an agenda, proceedings
of meetings, and the provision of information to outside officers in advance. Accordingly, these improvements
were reflected in the consideration of the transition to a company with a nominating committee, etc., which was
undertaken simultaneously, and the Company will strive for fundamental improvements with the structural
transition as a turning point.
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[Supplementary Principle 4-14(2)]
Training Opportunities for Directors
The Company continuously provides to Outside Directors explanation on the environment surrounding the Group
and its business, financial position, and organizational structure when assuming their position and during their
service so that they are able to fully recognize the Group’s important management issues and make best decisions
based on their beliefs at the Board of Directors and other committee meetings.
Meanwhile, for internal officers, on the assumption of giving them options for updating their knowledge even
during their services, the Company believes that the most important matter is to provide opportunities to develop
self-awareness and recognition as leaders who steer management for Executive Officers and presidents and
executive officers of Group companies who will be candidates for Directors and top management in the future.
Based on these views, the Company offers opportunities to acquire knowledge necessary as officers and develop
self-awareness as officers for new executive officers and presidents of Group companies when they are newly
appointed and systematically carries out an annual “Business Executive Program,” which meets attributes of each
target officer, in the second year and onward. In addition, the Company arranges external seminars as needed.
[Principle 5-1, Supplementary Principle 5-1(1)(2)]
Policy for Dialogue with Shareholders and Investors
The Company recognizes that dialogue with shareholders and investors is important for realizing sustainable
growth and enhancing corporate value over mid- to long-term. We make efforts to improve information disclosure
with regard to strengthening of corporate governance and progress of the mid- to long-term strategies in order to
promote constructive dialogue with shareholders.
The Company practices timely and accurate disclosure by establishing Timely Disclosure Regulations and other
regulations and policies about information disclosure. Furthermore, based on its IR Policy, the Company provides
opportunities for dialogue through interviews and briefing sessions, such as results briefings by top management,
small meetings for analysts, face-to-face meetings for individual domestic and overseas institutional investors, in
addition to the general meeting of shareholders, in a proactive and continuous manner to the extent reasonable.
Opinions gathered from such activities will be reflected in management.
Specific Systems and Measures to Encourage Constructive Dialogue with Shareholders and Investors
1) To promote constructive dialogue with shareholders, the President and CEO (Representative Executive Officer),
Managing Executive Officer and CFO, Managing Executive Officer and General Manager of Group Corporate
Strategy Office and other senior management cooperate to develop a platform, with Public Relations/Investor
Relations Department of the Group Corporate Strategy Office serving as a liaison office.
2) The Group Corporate Strategy Office and General Affairs Department cooperate organically as a platform for
supporting constructive dialogue with shareholders to provide information to responsible officers, etc.
3) The Company promptly provides information subject to disclosure to media organizations, and carries such
information on its website. In addition, shareholder newsletters and other notifications are prepared using easy-to-
understand terms. Furthermore, the Company organizes dialogues including dedicated meetings held by persons
in charge of investor relations with institutional investors, securities analysts, etc.
4) Opinions provided by shareholders and investors are reflected in the improvement of corporate value by broadly
sharing such information in-house and providing feedback to the management.
5) Based on the IR Policy, the Company observes a “Quiet IR Period,” during which it desists from investor
relations activities. During this period, officers and other employees of the Company desist from commenting to
external parties on earnings results and targets, as well as other information relating to financial accounts. In
addition to the “Quiet IR Period,” pursuant to the Insider Trading Regulations, the Company never refers to
significant matters, etc., that have not yet been publicly disclosed.
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2. Capital Structure
Ratio of shares held by overseas shareholders Updated From 10% to less than 20%
[Current Major Shareholders] Updated
Name / Company name Number of shares owned Percentage
(%)
The Master Trust Bank of Japan, Ltd. (Trust account) 37,642,200 9.90
Japan Trustee Services Bank, Ltd. (Trust account) 24,242,400 6.38
The Mitsukoshi Health and Welfare Foundation 13,667,832 3.60
Isetan Mitsukoshi Group’s partner holding companies 8,169,378 2.15
Japan Trustee Services Bank, Ltd. (Trust account 5) 7,022,900 1.85
SHIMIZU CORPORATION 6,200,000 1.63
JP MORGAN CHASE BANK 385151 6,141,025 1.62
Meiji Yasuda Life Insurance Company 5,697,279 1.50
Japan Trustee Services Bank, Ltd. (Trust account 9) 5,383,600 1.42
STATE STREET BANK WEST CLIENT-TREATY 505234 4,797,868 1.26
Supplementary explanation
-
3. Corporate Attributes
Listed stock exchange and market section Updated Tokyo Stock Exchange, First Section;
Fukuoka Stock Exchange
Fiscal year-end Updated March
Type of business Updated Retailing
Number of employees (consolidated basis) as of the end of
the previous fiscal year Updated More than 1,000
Net sales (consolidated basis) as of the end of the previous
fiscal year Updated Over ¥1 trillion
Number of consolidated subsidiaries as of the end of the
previous fiscal year Updated From 10 to less than 50
Controlling shareholders (excluding parent company) Updated -
Parent company Updated None
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4. Policy on Measures to Protect Minority Shareholders in Conducting Transactions with Controlling
Shareholders
-
5. Other Special Circumstances Which May Have Material Impact on Corporate Governance Updated
Isetan (Singapore) Ltd., a subsidiary of the Company in which Isetan Mitsukoshi Ltd. holds shares, is listed on the
Singapore Exchange. Negotiations regarding major policies take place as and when required among the Company,
Isetan Mitsukoshi Ltd. and the subsidiary in question. However, the independence of the Board of Directors of the
subsidiary will be respected. The Company holds 52.7% of the voting rights in Isetan (Singapore) Ltd.
II Business Management Organizations and Other Corporate Governance Systems regarding Management Decision-Making, Execution of Business and Oversight in Management
1. Organizational Composition and Operation
Organizational form Company with a nominating committee, etc.
[Directors]
Maximum number of Directors
stipulated in the Articles of
Incorporation Updated
15
Terms of office of Directors stipulated
in the Articles of Incorporation Updated 1 year
Chair of the Board of Directors Updated Chairman (except where the post is concurrently held by the
President)
Number of Directors Updated 13
[Outside Directors]
Number of Outside Directors Updated 7
Number of Outside Directors designated
as independent officers Updated 7
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Relationship with the Company (1) Updated
Name Attribute Relationship with the Company (*)
a b c d e f g h i j k
Michiko Kuboyama Joined the Company from another company
Masami Iijima Joined the Company from another company
Miwako Doi Joined the Company from another company
Takashi Oyamada Joined the Company from another company △
Takeo Hirata Academic
Hidetoshi Furukawa Joined the Company from another company △
Fukutaka Hashimoto Attorney
* Categories for “Relationship with the Company”
* “○” when the director presently falls or has recently fallen under the category;
“△” when the director fell under the category in the past
* “●” when a close relative of the director presently falls or has recently fallen under the category;
“▲” when a close relative of the director fell under the category in the past
a. Executive of the Company or its subsidiaries
b. Executive or non-executive director of a parent company of the Company
c. Executive of a fellow subsidiary company of the Company
d. A party whose major client or supplier is the Company or an executive thereof
e. Major client or supplier of the Company or an executive thereof
f. Consultant, accountant or legal professional who receives a large amount of monetary consideration or other
property from the Company besides remuneration as a Director/Audit & Supervisory Board Member
g. Major shareholder of the Company (or an executive of the said major shareholder if the shareholder is a legal
entity)
h. Executive of a client or supplier company of the Company (which does not correspond to any of d, e, or f)
(the Director himself/herself only)
i. Executive of a company, between which and the Company’s outside Directors/Audit & Supervisory Board
Members are mutually appointed (the Director himself/herself only)
j. Executive of a company or organization that receives a donation from the Company (the Director
himself/herself only)
k. Others
12
Relationship with the Company (2) Updated
Name
Committee Indepen
-dent
Director
Supplementary
explanation of the
relationship
Reasons for appointment Nomi-
nating
Compen-
sation Audit
Michiko
Kuboyama
○ ○ Communication Fellow,
Ordinary Citizens
Research Department of
Kao Corporation
Outside Director of
Sumitomo Mitsui
Banking Corporation
Michiko Kuboyama has served as General Manager
of the Products Public Relations Center and other
positions at Kao Corporation, engaging mainly in
product development and marketing departments.
Currently, her activities span diverse fields including
serving as Communication Fellow of the Ordinary
Citizens Research Department at Kao Corporation
and sharing her abundant experience in marketing as
Visiting Professor at TAMA GRADUATE SCHOOL
OF BUSINESS.
She took office as the Company’s Outside Director
in 2018 and has provided valuable advice from a
wide range of perspectives including that of the
consumer based on her abundant experience. As we
believe her giving appropriate advice and oversight
over business execution from an independent
standpoint will significantly contribute to the
improvement of the Company’s governance, she was
reappointed as Outside Director.
As a result of rigorous screening in light of the in-
house independence standards for independent
officers, it was judged that there is no risk of conflict
of interest with general shareholders. Accordingly,
she was appointed as an independent Director.
Masami
Iijima
○ ○ ○ Representative Director,
Chairman of the Board
of Directors of MITSUI
& CO., LTD.
Outside Director of
Ricoh Company, Ltd.
External Board Director
of SoftBank Group
Corp.
Counsellor of Bank of
Japan
Masami Iijima has served in management at MITSUI
& CO., LTD., one of the largest general trading
companies in Japan, with superior achievements in
achieving growth. Currently he serves as Chairman
of the Board of Directors of MITSUI & CO. as
Representative Director and Chairman of the Board
of Directors, promoting corporate governance as the
supervisor for management.
At the Company’s Board of Directors, he has
provided valuable advice based on his abundant
experience in corporate management. As we believe
his giving appropriate advice and oversight over
business execution from an independent standpoint
will significantly contribute to the improvement of
the Company’s governance, he was reappointed as
Outside Director.
As a result of rigorous screening in light of the in-
house independence standards for independent
officers, it was judged that there is no risk of conflict
of interest with general shareholders. Accordingly,
he was appointed as an independent Director.
Miwako Doi ○ ○ ○ Auditor of National
Institute of Information
and Communications
Technology
Executive Director of
Miwako Doi has worked as a researcher and
manager in the information technology field at
TOSHIBA CORPORATION with significant expert
achievements in the field. Currently, she serves as
Auditor of the National Institute of Information and
13
Name
Committee Indepen
-dent
Director
Supplementary
explanation of the
relationship
Reasons for appointment Nomi-
nating
Compen-
sation Audit
Nara Institute of
Science and Technology
Vice President of
TOHOKU
UNIVERSITY
Communications Technology in addition to
Executive Director of the Nara Institute of Science
and Technology and Vice President of TOHOKU
UNIVERSITY.
Based on her abundant experience in the information
technology field, she has provided valuable advice to
the Board of Directors of the Company, which aims
to become a platformer for a new era. As we believe
her giving appropriate advice and oversight over
business execution from an independent standpoint
will significantly contribute to the improvement of
the Company’s governance, she was reappointed as
Outside Director.
As a result of rigorous screening in light of the in-
house independence standards for independent
officers, it was judged that there is no risk of conflict
of interest with general shareholders. Accordingly,
she was appointed as an independent Director.
Takashi
Oyamada
○ ○ ○ Special Advisor of
MUFG Bank, Ltd.
Representative Director
& Vice Chair of The
Japan Institute of
International Affairs
Outside Director of
Mitsubishi Research
Institute DCS Co., Ltd
Outside Director of
Mitsubishi Electric
Corporation
Takashi Oyamada has served in management of the
former The Bank of Tokyo-Mitsubishi UFJ, Ltd., a
leading mega bank in Japan with superior
achievements. He possesses deep knowledge in
finance gained over years of experience at a financial
institution. Since taking office as Outside Director of
the Company, he has provided valuable advice at the
Board of Directors based on his specialized
knowledge in finance and high expertise in
management. As we believe his giving appropriate
advice and oversight over business execution from
an independent standpoint will significantly
contribute to the improvement of the Company’s
governance, he was reappointed as Outside Director.
As a result of rigorous screening in light of the in-
house independence standards for independent
officers, it was judged that there is no risk of conflict
of interest with general shareholders. Accordingly,
he was appointed as an independent Director.
Takeo
Hirata
○ ○ Professor at Graduate
School of Sport
Sciences, Waseda
University
Outside Company
Auditor of Rakuten, Inc.
Special Advisor to the
Cabinet
Chairman of the Japan
Society of Sports
Industry
Takeo Hirata has significantly contributed to the
promotion of sports business in Japan, having been
involved in the initiation of J. League and the
invitation of the 2002 FIFA World Cup to Japan.
Currently, he teaches as a Professor at the Graduate
School of Sport Sciences at Waseda University in
addition to playing an active part as Special Advisor
to the Cabinet.
He has provided appropriate advice and
recommendations as Outside Corporate Auditor of
the Company based on his abundant insight on
diverse subjects. As we believe his giving
appropriate advice and oversight from an
independent standpoint at the Company’s Board of
Directors after its transition into a company with a
nominating committee, etc., will significantly
contribute to the improvement of the Company’s
governance, he was appointed as Outside Director.
14
Name
Committee Indepen
-dent
Director
Supplementary
explanation of the
relationship
Reasons for appointment Nomi-
nating
Compen-
sation Audit
As a result of rigorous screening in light of the in-
house independence standards for independent
officers, it was judged that there is no risk of conflict
of interest with general shareholders. Accordingly,
he was appointed as an independent Director.
Hidetoshi
Furukawa
○ ○ ○ Chairperson of SMBC
Trust Bank Ltd.
Hidetoshi Furukawa has accumulated years of
experience at Sumitomo Mitsui Banking
Corporation, one of the largest mega banks in Japan.
After serving as Deputy President, etc., at Sumitomo
Mitsui Banking Corporation, he took office as
Representative Director, President and Chief
Executive Officer of SMBC Trust Bank Ltd. in 2015.
In this capacity, he significantly contributed to
providing revolutionary and high quality services,
such as by launching a new brand through the
integration of domestic individual-oriented
businesses of foreign-owned financial institutions.
He was appointed Chairperson of SMBC Trust Bank
Ltd. in 2018. As we believe his giving appropriate
advice and oversight based on his abundant
experience in management of financial institutions as
well as his specialized knowledge in finance from an
independent standpoint at the Company’s Board of
Directors will significantly contribute to the
improvement of the Company’s governance, he was
appointed as Outside Director.
As a result of rigorous screening in light of the in-
house independence standards for independent
officers, it was judged that there is no risk of conflict
of interest with general shareholders. Accordingly,
he was appointed as an independent Director.
Fukutaka
Hashimoto
○ ○ Representative Partner
Attorney and Director
of Tokyo Hatchobori
Law Office
Outside Audit &
Supervisory Board
Member of Sompo
Japan Insurance Inc.
Fukutaka Hashimoto has played a leading role as an
attorney-at-law for many years and was appointed
Representative Partner Attorney and Director of
Tokyo Hatchobori Law Office in 2008. In addition to
serving as Outside Corporate Auditor of several
companies while working as an attorney, he has
strived to solve national issues such as by serving as
a committee member for a third-party committee on
the pension records issue and a special committee
member for the Deliberation Committee on Disputes
for Compensation of Damages on Nuclear Power.
We believe his giving appropriate advice and
oversight based on his wide range of advanced
specialized knowledge primarily in corporate legal
affairs from an independent standpoint at the
Company’s Board of Directors will significantly
contribute to the improvement of the Company’s
governance. Accordingly, he was appointed as
Outside Director.
As a result of rigorous screening in light of the in-
house independence standards for independent
officers, it was judged that there is no risk of conflict
of interest with general shareholders. Accordingly,
he was appointed as an independent Director.
15
[Committees]
Composition and attributes of chair(s) at each committee Updated
Total of
members
Full-time
members
Internal
Directors
Outside
Directors Chair
Nominating Committee 5 0 1 4 Outside Director
Remuneration Committee 4 0 1 3 Outside Director
Audit Committee 5 1 1 4 Outside Director
[Executive Officers]
Number of Executive Officers Updated 7
Concurrent service Updated
Name Company
Representation
Concurrent service as Director Concurrent
service as
employee
Nominating
Committee member
Remuneration
Committee member
Toshihiko Sugie Yes Yes ○ × None
Toru Takeuchi Yes Yes × × None
Takuya Matsuo No No × × None
Hidehiko Igura No Yes × × None
Shigeru Nishiyama No Yes × ○ None
Hideki Katagiri No No × × None
Akira Kimbara No No × × None
16
[Audit Framework]
Directors and employees to assist the Audit
Committee with its duties Updated Available
Matters related to the independence of these Directors and employees from the Executive Officers Updated
The Company established and adequately staffed an organizational unit dedicated to the role of assisting the Audit
Committee under the instruction thereof. Personnel matter (appointment and change) of the staff in the unit shall
require the consent of the Audit Committee.
Cooperation between the Audit Committee, the accounting auditors and the Internal Audit Division Updated
The Audit Committee of the Company will monitor the legality and appropriateness of the execution of duties by
Executive Officers and Directors, and strengthen oversight functions through audits. In addition, the Audit
Committee will work to enhance the audits of the Group as a whole by coordinating with the Internal Audit
Division and Audit & Supervisory Board Members at each Group company, and further enhance the audit system
encompassing the entire group with the organizational transition as a turning point.
The Company is striving to establish a framework for providing appropriate information as required through the
cooperation between the Board of Directors Office and the Internal Audit Division, with a view to presenting
accurate information concerning the Company on a timely basis under the instruction of Outside Directors, while
effectively ensuring the cooperation between the Internal Audit Division, Directors and the Audit Committee
pursuant to various internal regulations.
The Company has entered into an audit contract with Ernst & Young ShinNihon LLC, which conducts the
accounting audits pursuant to the provisions of applicable laws and regulations. Three certified public accountants,
namely Mr. Kazuhiko Umemura, Ms. Eri Sekiguchi and Mr. Kiyotaka Kinugawa, executed the accounting audit
of the Company. The team of staff members that assisted the accounting audit of the Company is comprised of 31
certified public accountants, along with 41 others (including those who passed the certified public accountant
examination). Ernst & Young ShinNihon LLC has been in charge of the accounting audit of the Company since
our foundation in 2008.
Recognizing that accounting auditors assume accountability to shareholders and investors, the Company takes
appropriate measures to ensure appropriate audits. Specifically, the following structures are set in place so as to
ensure effectiveness of audits by accounting auditors.
1) The Company understands the status of audit implementations by accounting auditors and confirms the validity
of labor allocation in consideration of the audit scope and maintenance of quality.
2) The Company holds periodical discussions between accounting auditors and the Representative Executive
Officers and other Executive Officers.
3) The Audit Committee receives explanations from the accounting auditors on their audit plan and audit results
and holds periodical meetings to ensure adequate cooperation. In addition, the Internal Audit Division carries out
audits in cooperation with the accounting auditors by sharing audit plans, audit results, and risk information.
4) If the accounting auditors submit a report on misconduct regarding execution of duties by Executive Officers
or Directors, or on material facts regarding laws and regulations or the Articles of Incorporation (including facts
that may impact ensuring adequacy of documents on financial calculation), a necessary investigation will be made
after deliberation at the Audit Committee and necessary and timely measures will be taken such as reporting to
the Board of Directors or providing advice or recommendations to Executive Officers.
17
Also, the Audit Committee has adopted a system where the Audit Committee understands the status of audits of
accounting auditors through their audit reports and periodical meetings with them, and periodically evaluates their
audit activities, to decide their reappointment for each term based on the results of such evaluations, etc.
[Independent Officers]
Number of Independent Officers Updated 7
Matters relating to Independent Officers
The Company designates all outside officers qualifying as independent officers as independent officers.
[Incentives]
Implementation status of incentive policies for
Directors and Executive Officers Updated Performance-Linked Remuneration
Supplementary explanation Updated
Under the Director remuneration system of the Company, executive remuneration is composed of three elements:
monthly “basic remuneration” along with “bonuses” and “share-based remuneration” which are paid or granted
annually. For Executive Officers, including the President and CEO (Representative Executive Officer), bonuses
that are paid as a form of performance-linked remuneration shall account for 25% of the total annual
remuneration for each individual, with the aim of clarifying their responsibilities for business execution.
Meanwhile, share-based remuneration shall account for 15% of the total annual remuneration for each individual,
with a view toward promoting shareholdings by officers and their common interests with the shareholders.
(Bonuses shall not be paid to internal Directors except for those who concurrently serve as Executive Officer,
and Outside Directors.)
The Company is currently conducting fundamental considerations on ways for linking to the short-term
performance and the medium- to long-term performance in the entire remuneration and approach to the share-
based remuneration system that has replaced the remuneration-type stock options scheme, so that the officer
remuneration system functions better as a healthy incentive towards the sustainable growth of the Company. In
FY2020 and onwards after the transition to a company with a nominating committee, etc., the Compensation
Committee will continue such considerations and work to bring discussion results into shape.
Recipients of stock options
Supplementary explanation
-
18
[Remuneration for Directors and Executive Officers]
Disclosure (of individual Director’s remuneration)
Updated No disclosure of individual remuneration
Disclosure (of individual Executive Officer’s
remuneration) Updated No disclosure of individual remuneration
Supplementary explanation Updated
The following has been disclosed in the FY2019 Annual Securities Report, business report and notice of the
convocation of General Meeting of Shareholders.
Director remuneration
Fixed remuneration: 13 Directors, ¥227 million (including 7 Outside Directors, ¥48 million)
Stock options: 5 Directors, ¥66 million (including 0 Outside Directors)
Audit & Supervisory Board Member remuneration
Fixed remuneration: 6 Audit & Supervisory Board Members, ¥80 million (including 3 Outside Audit &
Supervisory Board Members, ¥30 million)
Note: Directors with simultaneous posts as executive officers do not receive remuneration, etc. for their
position as executive officer.
Policy on determining remuneration amounts and
calculation methods Updated Established
Disclosure of Policy on Determining Remuneration Amounts and Calculation Methods
Details are described in [Disclosure based on each of the principles of Japan’s Corporate Governance Code].
[System for Supporting Outside Directors] Updated
The Company provides the following support for Directors and Audit Committee members inside and outside
the Company such that they may sufficiently fulfil their roles.
(1) Information Provision to Outside Directors
The Company has established a system to provide Outside Directors with prior explanation before the Board of
Directors meetings so that they are able to ask for information as necessary, and the Company can additionally
provide appropriate information where necessary.
(2) Opinion Exchange Meeting for Outside Directors, Audit Committee Members and Representative Executive
Officers
The Company periodically holds meetings for exchanging opinions between the Audit Committee and other
Outside Directors, as well as between all Outside Directors and the President and CEO (Representative Executive
Officer) and other management, as part of measures to increase opportunity for Outside Directors to obtain
information about the Group and exchange opinions.
(3) Training Opportunities for Outside Directors
The Company continuously provides to Outside Directors explanation on the environment surrounding the
Group and its business, financial position, and organizational structure when assuming their position and during
19
their service so that they are able to fully recognize the Group’s important management issues and make best
decisions based on their beliefs at the Board of Directors and other committee meetings.
(4) Expenses for Receiving Advice Deemed by Directors to Be Necessary
The Company has regulations in place stipulating that, if Directors deem it necessary to receive advice from
consultants, lawyers and other external experts, they may do so at the expense of the Company, and established
such system.
[Former Representative Director and President, etc.]
Names, etc. of consultants and advisers, etc. who are former Representative Director and President, etc.
Updated
Name Titles and positions
Duty
Arrangements and conditions (Full-time/part-time;
with/without remuneration, etc.)
Date of retirement
as President, etc.
Term of office
Kunio
Ishizuka
Senior
Advisor
Engaged in activities as a
Vice Chair of the
KEIDANREN (Japan
Business Federation) and
other officer positions of
industry groups, etc., that
the Company has
membership or affiliation,
based on delegation by the
Board of Directors and
Representative Executive
Officers of the Company.
Part-time
With remuneration
The Company appoints a
former Representative
Director to the position of
Senior Advisor after
retirement only when such
person acts as an officer of an
important external
organization (business
association and industry
group) designated by the
Company. These persons are
not involved in any
management decision-
making of the Company.
June 21,
2017
He retired as Vice
Chair of the
KEIDANREN
(Japan Business
Federation) on June
2, 2020 following
the expiration of
term of office,
while he is
scheduled to retire
as Senior Advisor
of the Company at
the end of June
2020.
Total number of consultants and advisers, etc. who are
former Representative Director and President, etc.
Updated 1
Other matters Updated
1. After having retired as President and CEO of the Company on February 1, 2012, the above Senior Advisor
assumed office of Chairman, Representative Director and Executive Officer, and then left office on June 21,
2017.
2. Appointment and remuneration, etc. of Senior Advisors were deliberated upon by the Nomination and
Remuneration Committee chaired by an Outside Director when the Company was a company with the Audit
& Supervisory Board, and determined by the Board of Directors.
3. Since its establishment in 2008, the Company has not appointed any consultants, and abolished its consultant
system (Consultant Regulations) on April 1, 2018. For advisors, their purpose and duties, etc. have been
stipulated in internal regulations, but currently we have no other advisors other than the above Senior Advisor.
20
2. Matters on Functions of Business Execution, Auditing, Oversight, Nomination and Remuneration Decisions (Overview of Current Corporate Governance System) Updated
The goals the Company hopes to achieve through the transition to a company with a nominating committee, etc.
are as follows:
• Clear delineation of the roles of “execution” and “oversight,” establishing a general direction of the Group by
the Board of Directors, and specialization of oversight and monitoring of business execution. We believe that
this will enhance the oversight function of the Board of Directors, while enabling swift execution of business.
• Establishment of a statutory Nominating Committee, Remuneration Committee, and Audit Committee, and
implementing such important governance measures as selection and dismissal of top management, in a highly
objective and transparent manner, led by Outside Directors.
[Business execution] Roles and Responsibilities of the Board of Directors As part of efforts to promote the Group’s sustainable growth and the enhancement of corporate value over mid- to long-term, and sufficiently fulfil its fiduciary responsibility to shareholders, the Company worked to further clarify the separation of “execution” and “oversight” and strengthen decision-making functions and oversight functions to be fulfilled by the Board of Directors, through the review of criteria for making proposals to be decided upon by the Board of Directors and the delegation of authority to the execution side where necessary within a range of a company with the Audit & Supervisory Board. Under this environment, the Company’s Board of the Directors actively engaged in discussions on important managerial issues from a wide perspective, utilized such discussions for preparing the mid- to long-term management plan, and, through the monitoring of the progress of the plan, worked to establish the management PDCA cycle with the Board of Directors as the starting point. The Board of Directors after the transition to a company with a nominating company, etc. will further accelerate the move, and limit matters requiring a resolution by the Board of Directors to those set forth in laws and regulations, in principle, whereby it will primarily discuss management from a wide perspective and specialize in overseeing and monitoring the execution of business operations. Composition of the Board of Directors The Company’s Articles of Incorporation stipulates that the number of Directors shall not exceed 15, and currently there are 13 members in the Board of Directors. In light of strengthening corporate governance, Outside Directors are in the majority in the Board of Directors (seven Outside Directors and six internal Directors). Furthermore, the policy of the Company for the Board of Directors is to appoint a diverse range of people with broad and highly specialized knowledge and skills, as well as high ethical standards. For Outside Directors in particular, the Company invites people from different fields and industries, primarily those with practical business-world experience, in order to actively take in a wide range of opinions from objective and specialist perspectives and ensure well-balanced management. All Outside Directors satisfy the Independence Standards of the Company. Furthermore, the Regulations of the Board of Directors set out that the Board of Directors shall be chaired by a non-executive Director. The Company has made it clear from FY2020 that the current Chairman, who will continue presiding over the Board of Directors, is non-executive. Executive Systems and Organs After appointing Chief Officers and persons responsible for the execution of business operations at key divisions as “Executive Officers,” a “Board of Executive Officers” will be established as an organ for executive decision-making and discussion, and it will discuss and make decisions concerning important Group issues, including matters over which authority has been delegated by the Board of Directors. [Matters concerning decisions on auditing and oversight, nomination, and remuneration] 1) The Nominating Committee will engage in discussion and make decisions related to the “nomination” of officers with a high degree of objectivity and transparency, under the leadership of Outside Directors. In order to do so, the Nominating Committee will clarify officer selection standards and focus on enabling independent judgments by Outside Directors, by measures including the utilization of personnel evaluations and other objective indicators and increased contact with prospective nominees. The Nominating Committee is comprised of a majority of Outside Directors and chaired by an Outside Director. The President and CEO (Representative Executive Officer), who is also one of the members to improve the effectiveness of the succession plan, shall
21
leave the meeting as in the operations by the Nomination and Remuneration Committee when making a decision on reappointment of the current President and CEO (Representative Executive Officer), which is important in terms of corporate governance, in order to improve the effectiveness. 2) Like the Nominating Committee, the Compensation Committee will engage in discussion and make decisions related to “remuneration” of officers and take steps to further enhance corporate governance, under the leadership of an Outside Director. The committee will discuss issues and policy related to officer remuneration plans, including the Company’s approach to incentives for officers to enhance corporate value, and it will utilize various objective indicators such as personnel evaluation, and participate in third-party surveys on remuneration to enable independent judgments by Outside Directors concerning the appropriateness of individual remuneration proposals. The Compensation Committee is comprised of a majority of Outside Directors and chaired by an Outside Director. The President and CEO (Representative Executive Officer) shall not be included in the members to eliminate arbitrariness. 3) The Audit Committee will monitor the legality and appropriateness of the execution of duties by Executive Officers and Directors, and strengthen oversight functions through audits. In addition, the Audit Committee will work to enhance the audits of the Group as a whole by coordinating with the Internal Audit Division and Audit & Supervisory Board Members at each Group company, and further enhance the audit system encompassing the entire group with the organizational transition as a turning point. While the Company’s policy sets out that the Audit Committee shall be chaired by an Outside Director who has served as Audit Committee member for at least one term, with a view to enhancing the committee’s independence and ensuring its effectiveness, the position of chairman is currently served by an internal Director concurrently serving as full-time Audit Committee member during the initial period after the transition to a company with a nominating committee, etc., in order to facilitate smooth transition from the Audit & Supervisory Board.
3. Reasons for Adopting the Current Corporate Governance System Updated
In light of the impact of corporate activities on society, the Company decided on the transition of its organizational design to a company with a nominating committee, etc. effective June 2020, aiming for further advancing corporate governance. Specifically, Outside Directors shall represent a majority in each of the Board of Directors, Nominating Committee, Remuneration Committee and Audit Committee. Doing so will help clarify the separation of the roles between “execution” and “oversight,” thus further enhancing the transparency of corporate activities in pursuit of compliance-based management. The Group’s goal is to become a corporate group that earns more trust from all stakeholders through efforts to create diversified value to be presented to all stakeholders touched by the Group. To this end, the Group will continuously endeavor to accelerate management decision-making, strengthen management oversight mechanisms and enhance internal control systems. For this reason, the Company has adopted the current corporate governance system.
22
III Implementation of Measures for Shareholders and Other Stakeholders
1. Measures to Vitalize the General Meeting of Shareholders and Smooth Exercise of Voting Rights Updated
Supplementary explanation
Early sending of Notice of
Convocation of the General
Meeting of Shareholders
The Company usually sends the notice of the convocation of the General
Meeting of Shareholders three weeks before the day of the meeting so that
shareholders have sufficient time for examining the agenda of the meeting.
The novel coronavirus pandemic of this year, however, delayed the
delivery of the notice despite the Company’s effort to send it early,
resulting in sending the notice two weeks before the deadline for the
exercise of voting rights. The information on the notice is disclosed on the
Company website and Tokyo Stock Exchange’s TDnet approximately one
month prior to the day of the meeting.
Scheduling of general meeting
of shareholders avoiding the
peak day
Since the Company’s first Ordinary General Meeting of Shareholders in
2009, it has taken into account shareholder convenience and has held such
meetings on non-peak days.
Allowing electronic exercise
of voting rights
The Company has adopted these measures since its first Ordinary General
Meeting of Shareholders in 2009.
Participation in the electronic
voting platform and other
efforts to enhance the
environment for the exercise
of voting rights by
institutional investors
Since the Company’s first Ordinary General Meeting of Shareholders in
2009, it has participated in the platform for the electronic exercise of voting
rights operated by ICJ, Inc.
Provision of the convocation
notice (summary) in English
Since the Company’s first Ordinary General Meeting of Shareholders in
2009, it has used the platform for the electronic exercise of voting rights
operated by ICJ, Inc. to offer English-language notices of convocation.
Additionally, beginning in 2010, it has published English-language notices
of convocation and other documents on the Tokyo Stock Exchange’s
website. These documents are also published on the Company website.
23
2. IR Activities Updated
Supplementary explanation Presentation by
Representatives
Preparation and publication of
disclosure policies
The Company impartially dispatches timely and
appropriate information about daily IR and public
relations activities, and creates and adheres to a
disclosure policy (IR policy) to gain the trust and
empathy of shareholders and investors. Furthermore,
this policy is published on the Company website.
https://www.imhds.co.jp/en/ir/policy/ir_policy.html: IR
Policy
Regular briefings for private
investors
Shareholder questionnaire survey is conducted every
year. Not available
Regular investor briefings for
analysts and institutional
investors
Twice a year (Q2, Q4) after earnings releases, the
Company holds briefings for analysts. Additionally, the
Company holds small meetings and holds individual
face-face meetings on a regular basis for domestic
major shareholders and institutional investors.
Available
Regular investor briefings for
foreign investors
The Company participates in overseas conferences
hosted by securities companies several times a year, and
holds regular face-face meetings with major
shareholders.
Available
Posting of IR materials on the
website
Earnings releases, monthly sales reports, news releases,
Integrated Reports, and more are published on the
website in Japanese and English.
https://www.imhds.co.jp/en/index.html
Establishment of division
and/or manager in charge of IR
Public Relations/Investor Relations Department,
Group Corporate Strategy Office
24
3. Measures to Ensure Due Respect for Stakeholders Updated
Supplementary explanation
Rules based on internal
regulations to ensure due
respect for stakeholders
The Company stipulates in its Corporate Governance Guidelines, “In
combination with measures to build excellent relationships with customers,
employees, shareholders, business partners and local communities—our
stakeholders—the Group is overhauling its corporate governance structure,
along with management reform. This entails the establishment and
strengthening of legal frameworks for the general meeting of shareholders,
the Board of Directors and the accounting auditors. As part of these efforts,
for the purpose of further advancing corporate governance, the Company
decided on the transition of its organizational design to a company with a
nominating committee, etc. effective June 2020.
The Company stipulates that “With the transition to a company with a
nominating committee, etc. as a turning point, the Group will work to
further increase the transparency of our corporate activities and ensure
thorough compliance in our management, while taking measures to create
and deliver value in various forms for all stakeholders associated with the
Group. Aiming to become a corporate Group that is deeply trusted by all
of its various stakeholders, the Group will continue taking a range of
measures including speeding up management decision-making,
strengthening management oversight mechanisms and enhancing internal
control systems,” and is working to ensure that all employees understand
and comply with the stipulation.
Implementation of
environmental activities and
CSR activities, etc.
Under the Group’s “Basic Policy on Sustainability,” the Company will
fulfill its corporate social responsibility by addressing various social issues
from ESG and SDGs perspectives and contributing to solving them through
its corporate activities, and play its role in realizing both prosperous future
for all the surrounding people and a sustainable society.
We have designated priority sustainability efforts by identifying social
issues and environmental changes that would influence the Group’s
challenge towards sustainable growth and classifying initiatives that are
most important in terms of risk and opportunity into three groups. Going
forward, we will decide and promote specific initiatives by “connecting
people and local communities,” “connecting sustainable societies and
times,” and “improving the satisfaction of employees” as a corporate group
that connects people and bridges times.
Meanwhile, we conduct a questionnaire survey of our WEB members
every year regarding our sustainability activities, and the opinions received
through the survey are utilized in our sustainability initiatives.
https://imhds.disclosure.site/ja/themes/116 (available in Japanese only):
Questionnaire survey of our customers concerning sustainability
Development of policies on
information provision to
stakeholders
Regarding the Group’s corporate activities, the Group discloses to all
stakeholders business-related information about products, services, and so
on, as well as financial information in a timely and appropriate manner.
Additionally, in order to build irreplaceable relationships of trust with
stakeholders going into the future, it both offers information on its website
out of regard for simultaneity and fairness while also creating an
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Supplementary explanation
engagement form to receive thoughts and opinions from various
stakeholders, attempting to optimize its activities while making
communication more two-sided.
Other
[Sustainability philosophy at Isetan Mitsukoshi Group]
Isetan Mitsukoshi Group would like to move forward together with the
communities, society and the world, through building up, maintaining and
improving a solid relationship of mutual trust with all concerned parties
surrounding the Group, such as customers, employees, shareholders and
business partners, which shall serve as the basis of a virtuous cycle to be
formed in cooperation with business partners, giving rise to customer
satisfaction leading to shareholder satisfaction, hence employee
satisfactions.
Isetan Mitsukoshi Group’s “Basic Policy on Sustainability,” “Isetan
Mitsukoshi Group Human Rights Policy,” “Isetan Mitsukoshi Group
Procurement Policy” and “Isetan Mitsukoshi Group Environmental Policy”
are disclosed on the Company website and disseminated to all employees
through training and other opportunities for enlightenment.
https://imhds.disclosure.site/en/themes/86: Policies on Sustainability
[Promoting active roles for female employees including managerial
appointment]
The Group is engaged in the initiatives for better work-life balance that
support active female participation, such as improvements in various
institutional framework and working form, along with review of personnel
systems and its operation. Currently 5 female officers (2 Outside
Directors,2 executive officers and 1 President of a Group subsidiary) serve
within the Group. Female employees hold key managerial posts in the areas
such as merchandising, sales, branch general affairs, and back office
departments, and further efforts will be made along these lines.
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IV Matters Related to the Internal Control System
1. Basic Approaches to the Internal Control System and the Progress of System Development Updated
Isetan Mitsukoshi Holdings Ltd. (hereinafter the “Company”) develops the system below (hereinafter the
“Internal Control System” to ensure the compliance of its business operations as part of its attempts to conduct
healthy and transparent group management and maximize corporate value.
1. Compliance Systems
“Systems to ensure that business duties as executed by Executive Officers and employees of the Company
are in compliance with laws, regulations, and the Articles of Incorporation” (Article 416, Paragraph 1, Item
1-v of the Companies Act and Article 112, Paragraph 2, Item 4 of the Companies Act Enforcement
Regulations)
(1) The Board of Directors shall convene on a regular basis pursuant to the Regulations of the Board of
Directors, to resolve mainly on matters required to be deliberated at the Board of Directors by laws and
regulations (hereinafter the “Statutory Board Matters”), while overseeing business execution by Executive
Officers and preventing violations of laws, regulations, and the Articles of Incorporation.
(2) The General Affairs Department shall establish sections and individuals with jurisdiction over compliance-
related matters, maintaining and improving systems for compliance with internal control and laws and
regulations.
(3) In order to increase the legal compliance, efficiency, and legitimacy of the decision-making and oversight
by the Board of Directors, there shall be a majority of Outside Directors among Directors.
(4) An independent, specialized Internal Audit Division shall be created. Internal audits will be in accordance
with the “Regulations of Internal Audits” and be implemented as each division works with the Internal
Audit Division to audit the legal compliance and legitimacy of business affairs.
(5) In the case that the Company or the Group commits an act of wrongdoing, the Company shall confirm the
nature of the situation in a timely manner and form the “Isetan Mitsukoshi Group Hotline” as a point of
contact for internal reports from employees for self-betterment.
2. Risk Management Systems
“Regulations and other systems involving management of risks of loss to the Company” (Article 112,
Paragraph 2, Item 2 of the Companies Act Enforcement Regulations)
(1) Risks shall be prevented from occurring by identifying, evaluating, and analyzing risks that may occur in
the course of business operations and using this information to select risks that require prioritized response.
(2) In the case that a risk does occur, company-wide internal management systems that allow for rapid
response shall be organized through methods such as the establishment of a countermeasures headquarters
and the managing of information.
(3) Relevant regulations shall be established with regards to risk recognition, evaluation, and response and
be made well-known and thoroughly understood.
(4) Audits by the Internal Audit Division will attempt to detect risks facing the Company at an early stage
and settle them.
(5) Involvement with anti-social forces shall be eliminated and any unjust demands shall be rejected to
prevent related damages.
3. Internal Control Systems Regarding Financial Reporting
“Systems to ensure the appropriateness of financial reporting” (Article 24-4-4 of the Financial Instruments
and Exchange Act)
(1) Company-wide policies and procedures shall be indicated to ensure appropriate financial reporting and
conduct that are adequately built and operated.
(2) Appropriate evaluation and response shall be taken regarding the risk of misstatements made on items of
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importance in financial reports, and systems shall be adequately built and operated to reduce such risk.
(3) The Company shall build and operate methods to identify, understand, and process truthful and impartial
information that is then communicated to the appropriate parties in a timely manner.
(4) A financial reporting-related monitoring system shall be built and appropriately operated.
(5) A system shall be built to report internal control issues (deficiencies) understood through the course of
monitoring in a timely and appropriate manner.
(6) Adequate support shall be given to information technologies relating to internal controls involved in
financial reporting.
4. Information Storage Management Systems
“Systems regarding the storage and management of information relating to the execution of business duties
of Executive Officers at the Company” (Article 112, Paragraph 2, Item 1 of the Companies Act Enforcement
Regulations)
(1) The following documents related to the execution of business duties by Executive Officers shall be
recorded, stored, and managed together with related materials for a prescribed period according to the
“Document Retention Policies”:
(i) Minutes of the general meeting of shareholders
(ii) Minutes of the meetings of the Board of Directors
(iii) Minutes of the meetings of the Board of Executive Officers
(iv) Financial statements
(v) Copies of documents submitted to government administrative offices, other public agencies, and markets
for financial instruments
(vi) Other documents as determined by the Board of Directors
(2) Protection and management systems and other methodologies shall be used to create regulations such as
the “Information Retention Policies” for management information, trade secrets, and personal information
of customers, etc. that should be kept confidential according to laws and regulations including the
Companies Act and the Financial Instruments and Exchange Act, and the compliance of related Directors,
Executive Officers and employees shall result in its safe storage.
5. Systems for the Efficient Execution of Duties
“Systems to ensure the efficient performance of Executive Officers’ professional duties at the Company”
(Article 112, Paragraph 2, Item 3 of the Companies Act Enforcement Regulations)
(1) Division of duties to be executed by Executive Officers as well as the relevant chain of command shall
be decided by the Board of Directors.
(2) The Board of Directors shall resolve primarily on the Statutory Board Matters, delegating decision-
making authority on other important matters to Executive Officers. Such other important matters shall be
deliberated and decided by resolution at the Board of Executive Officers consisting primarily of Executive
Officers.
(3) The Company shall adopt an executive officer system to streamline the business execution through
clarification of the executive duties of executive officers.
(4) The Company shall adopt a chief officer system, whereby the Chief Officer assigned by the President and
CEO (Representative Executive Officer) to be in charge of important areas of operation shall promote
cross-departmental control of issues facing the entire Group.
(5) The Company shall define details of duties, responsibilities and procedures in “Regulations of Duties and
Authority,” “Regulations of the Conduct of the Business,” and “Regulations of Decision Making Process
for the Group” for execution of duties.
6. Group Company Management Systems
“Systems to ensure the compliance of the business conducted by the corporate groups consisting of the
Company and its subsidiaries” (Article 112, Paragraph 2, Item 5 of the Companies Act Enforcement
Regulations)
The Company shall develop a system to ensure the compliance of the business conducted by each company
in the Group, as described below.
1. “Systems relating to reports by the Company on items relating to the execution of business duties by the
Directors of the Company’s subsidiaries” (Article 112, Paragraph 2, Item 5-i of the Companies Act
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Enforcement Regulations)
With regards to business management, in addition to the introduction of integrated accounting systems and
efforts toward uniform management through the widening of target scope, approval and reporting systems
shall be managed and monitored as necessary. Additionally, the “Regulations on Group Company
Management” shall be used as a base for reporting by Group companies to the Company regarding matters of
importance and for establishing rules regarding discussion in pursuit of improved risk management and
efficiency across the entire Group.
2. “Regulations regarding the management or risk of loss to subsidiaries of the Company and other systems”
(Article 112, Paragraph 2, Item 5-ii of the Companies Act Enforcement Regulations)
(1) Regarding risk management for the Group, needed items shall be established in the “Basic Regulations on
Risk Management," and a specialized independent division as a division responsible for matters related to
risk management shall be created within the General Affairs Department. The said division shall work
with companies in the Group as it promotes risk management.
(2) In order to realize comprehensive risk management across the entire Group, a Compliance and Risk
Management Promotion Committee shall be created consisting of the Company’s President and CEO
(Representative Executive Officer) as the chairman as well as members selected by said chairman.
3. “Systems to ensure the efficient execution of business duties by Directors, etc. of subsidiaries of the
Company” (Article 112, Paragraph 2, Item 5-iii of the Companies Act Enforcement Regulations)
(1) The Company shall optimize its business operations by respecting the independence of the Group
companies while also managing their managerial affairs and providing advice and guidance, as well as by
dispatching Directors and Audit & Supervisory Board Members as necessary to understand the state of
their management.
(2) The Group companies shall obtain an approval by the President and CEO (Representative Executive
Officer) of the Company or its Board of Directors for important items whose management is deemed to
have major effects.
4. “Systems to ensure the compliance of the execution of duties of Directors and employees of subsidiaries of
the Company with laws, regulations, and Articles of Incorporation” (Article 112, Paragraph 2, Item 5-iv of
the Companies Act Enforcement Regulations)
(1) The Internal Audit Division shall conduct internal audits of Company Group companies, auditing the legal
compliance, appropriateness, etc. of executed business duties.
(2) A compliance guidebook and other documents shall be created and thoroughly disseminated throughout
the Group while training regarding appropriateness and legal compliances is held to foster an awareness
of compliance.
(3) An “Isetan Mitsukoshi Group Hotline” shall be established as a point of contact for internal reports
regarding the Group as a whole, and corrective measures and future prevention measures shall be
undertaken from a compliance standpoint with regards to these reports from employees, etc.
7. Items Relating to Audit Staff
“Items relating to Directors and employees assigned to assist the Audit Committee in performing its duties,
items relating to the independence of such Directors and employees from Executive Officers, and items
relating to procedures to ensure effectiveness of the Audit Committee’s instructions to such Directors and
employees” (Article 112, Paragraph 1, Items 1 to 3 of the Companies Act Enforcement Regulations)
(1) A unit dedicated to assisting the Audit Committee in performing its duties shall be established with staff
(hereinafter the “Audit Committee staff”). The Audit Committee may give instructions to the Audit
Committee staff regarding items necessary for auditing duties.
(2) The Audit Committee staff shall report on the matters as required by the Audit Committee, and shall be
entitled to gather information necessary for such report.
(3) The Audit Committee staff shall be independent from executive operational systems, be attached to the
Audit Committee, and carry out their duties as instructed by the Audit Committee. Personnel changes,
evaluation, discipline, and other such treatment pertaining to the staff shall require the consent of the Audit
Committee.
(4) The Audit Committee staff shall be seconded to each Group company as part-time Audit & Supervisory
Board Member, with a view to reinforcing the audit framework of the entire Group.
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8. Systems Relating to Reports to the Audit Committee
1. “Systems for reports to the Audit Committee of the Company by its Directors (excluding those who are
Audit Committee members), Executive Officers and employees as well as systems relating to other reports
to the Audit Committee” (Article 112, Paragraph 1, Item 4-i of the Companies Act Enforcement
Regulations)
“Systems for reporting to the Audit Committee of the Company by Directors, Audit & Supervisory Board
Members and employees of the Company’s subsidiaries, or by individuals who have received reports
therefrom” (Article 112, Paragraph 1, Item 4-ii of the Companies Act Enforcement Regulations) (1) Matters to be reported to the Audit Committee at its request by Directors, Executive Officers and
employees, or the matters to be reported to the Audit Committee without delay as circumstance that warrants such reporting arises, shall be prescribed in the “Regulations of the Audit Committee” formulated by the Board of Directors, whereby Directors, Executive Officers and employees shall make such report as needed. Notwithstanding the foregoing, the Audit Committee may request reports from Directors, Executive Officers and employees at any time if necessary.
(2) Directors, Audit & Supervisory Board Members, or employees of a subsidiary, or individuals who have received reports therefrom may report to the Audit Committee of the Company on important matters that may affect the business or performance of such subsidiary.
(3) The Isetan Mitsukoshi Group Hotline, an internal hotline system that covers the Group as a whole, shall be adequately maintained, and its operation status, nature of issues reported through this system, and the results of the follow-up investigation shall be reported to the Audit Committee on a regular basis.
2. “Systems to ensure that individuals who give applicable reports under item 1. are not subject to unfavorable treatment because of such reporting” (Article 112, Paragraph 1, Item 5 of the Companies Act Enforcement Regulations)
It shall be forbidden to treat individuals who give reports to the Audit Committee in an unfavorable manner because of the applicable reports.
9. Policy for Processing Auditing Fees
“Items relating to the advance payment of fees resulting from the execution of duties of the Audit Committee of the Company, fees resulting from the execution of applicable duties including repayment procedures, and policies involved in the processing of obligations” (Article 112, Paragraph 1, Item 6 of the Companies Act Enforcement Regulations) When Audit Committee members bill for prepayment of fees, etc. for the execution of their duties based on Article 404, Paragraph 4 of the Companies Act, fees and obligations related to those billings must be processed unless it is deemed that they are not necessary for the execution of those Audit Committee members’ duties.
10. Systems Relating to the Ensured Efficacy of Audit Committee Audits “Other systems to ensure the efficient operation of Audit Committee members’ audits” (Article 112 Paragraph 1, Item 7 of the Companies Act Enforcement Regulations)
(1) The Audit Committee shall have regular meetings for exchanging opinions individually with Representative Executive Officers, the chairman of the Board of Directors, Directors other than those concurrently serving as the Audit Committee members and the accounting auditors.
(2) In addition to the Board of Directors, Audit Committee members selected by the Audit Committee may attend important meetings in order to understand the decision-making process for important matters as well as the state of executed duties.
(3) The Internal Audit Division shall report to the Audit Committee on the internal audit plan, audit results and the progress of audits across the Group, while coordinating information exchange. The Audit Committee shall, upon receipt of a report on misconduct of Executive Officers in the course of executing their duties, or material facts involving their violation of laws and regulations or the Articles of Incorporation, or otherwise where necessary, may request the Internal Audit Division to conduct investigation, and give concrete instructions thereon. Personnel affairs and disciplinary actions involving the general manager of the Internal Audit Division shall require consent of the Audit Committee.
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2. Basic Views on Eliminating Anti-Social Forces and Current Implementation Status Updated
The Group shall eliminate any relationship with anti-social forces that threaten the order or safety of a healthy society, and takes a firm stance against such forces as a group. Also, in addition to avoiding any contact with anti-social forces in advance, the Group shall not submit to any unjust demands made by such forces and will use legal methods to resolve such issues. As the Group’s system to eliminate anti-social forces, customer consulting offices in subsidiary stores shall be used as a primary place of resolution, while the General Administration Departments of subsidiary headquarters shall be used as supervisory places of resolution. When circumstances dictate, the headquarters’ General Administration Department shall work together with subsidiaries to resolve issues as an entire group. The police, The National Center for the Elimination of Boryokudan (Anti-Social Forces), attorneys, and other outside expert organizations will be used to exchange information and conduct training with to strengthen this policy through cooperation, and efforts will be made toward internal awareness-raising activities.
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V Other
1. Adoption of Anti-Takeover Measures
Adoption of anti-takeover measures Updated Not adopted
Supplementary explanation Updated
The Company does not implement anti-takeover measures. In the case that an acquisition of a large volume of
shares may be conducted, the Company will take action through appropriate procedures by examining its
necessity and rationale. Also, in the case of a tender offer of the Company’s shares, the Company will express
its position and not take unreasonable measures to prevent shareholders from accepting a tender offer.
2. Other Matters Concerning Corporate Governance System Updated Overview of the Timely Disclosure System
The Company’s internal system regarding timely disclosure of company information is as follows.
1. Basic View
The Company’s goals are to enhance compliance and ensure trust in company information, etc., which is why in
addition to establishing the Timely Disclosure Regulations, the Insider Trading Regulations have been established
and thoroughly spread to prevent information leaks relating to disclosure process and preventing insider trading.
Accordingly, information disclosure is conducted as follows.
2. Internal Systems Regarding Timely Disclosure
For “information on determined material facts,” “information on material facts which occurred regardless of the
Company’s intent,” and “information relating to financial statements” relating to the Company and/or subsidiaries,
in addition to the information for which the Company is obligated to conduct timely disclosure according to public
securities exchange regulations, information that do not apply to these regulations but for which the Company deems
it necessary to conduct timely disclosure are handled according to the following internal systems.
(1) Information on determined material facts / information on material facts which occurred regardless of the
Company’s intent
⚫ For information that requires timely disclosure or whose necessity of timely disclosure is unclear, a report is
made to the person responsible for the handling of information for timely disclosure, by the General Manager
of the division with jurisdiction over the information (hereinafter the “division with jurisdiction”) when the
information involves the Company, or by the General Manager of the subsidiary’s division with jurisdiction
over the information (hereinafter the “subsidiary division with jurisdiction”) when the information involves the
Company’s subsidiary.
⚫ The person responsible for the handling of information for timely disclosure will disclose information according
to public securities exchange regulations. For information that does not correspond to these regulations, the
person responsible for the handling of information for timely disclosure will, as necessary, report to the Board
of Executive Officers and make disclosure decisions.
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⚫ In the case that timely disclosure is deemed appropriate by the Company, the Group Corporate Strategy Office,
the division responsible for disclosure, will discuss the disclosed content with the division with jurisdiction or
the subsidiary division with jurisdiction and conduct disclosure in a prescribed method.
(2) Information relating to financial statements
The Accounting Division of General Affairs Department will receive approval from the Board of Directors or the
Board of Executive Officers and from the person responsible for the handling of information for timely disclosure,
and the Group Corporate Strategy Office, the division responsible for disclosure, will disclose the information by the
designated methods.
(3) Reports to the Board of Executive Officers
The person responsible for the handling of information for timely disclosure shall report the content, time period,
reason, etc. of information, etc. that has been disclosed in a timely manner to the Board of Executive Officers on a
regular basis.